Close-Up: Live Issue - Should DM choose 'opt-in' or 'opt-out'?

Mounting pressure to reduce the 78,000 tonnes of direct mail that ends
up as landfill each year has highlighted divisions within the direct
marketing industry.

In January, David Miliband, the environment minister, pledged a "war on
junk mail", suggesting the Government could introduce legislation to
enforce "opt-in" to direct mail, and stating the 550,000 tonnes sent
annually is unacceptable to consumers and the environment.

Under the threat of legislation, the DM industry is seeking a way to
present a united front, despite the opposing views concerning the
"opt-in, opt-out" debate.

The IPA has embraced "opt-in" through its direct marketing charter since
2004. It says it is committed to the principles of permission and
consent in the use of personal data, and encourages its agencies to
promote "opt-in" to clients.

The IPA has met with resistance from member agencies, but argues that
databases that are more accurately targeted can only be good for
business. It takes the view that "opt-in" is inevitable and that large
companies are pointing the way by taking a global best practice view,
permissioning all data if possible.

David Payne, the consultant head of direct marketing at the IPA, says:
"More and more people argue that databases are a tangible asset on the
balance sheet, and some larger companies approach it with this
mentality. A lot of award-winning programmes are won by people with
permissioned databases like Diageo or Unilever."

The Direct Marketing Association, which represents agencies, suppliers
and clients, believes in existing self-regulation. It thinks universal
"opt-in" would damage its members' interests and defends its mailing
preference service (MPS), which it maintains is strong enough to protect
both consumer interests and the environment.

It claims in a recent statement that 12 per cent of households are
registered for MPS, and awareness of the service stands at 44 per cent,
so a substantial number of households "do not see direct mail as a major
problem".

Chris Arnold, the chairman of the DMA Agency Council and creative
partner at Feel, says "opt-in" removes consumer choice, and that MPS is
there to help provide it. "If any advertising is of some value or
relevance to people, they generally like it," he says.

The Department for Environment, Food and Rural Affairs says it wants to
extend the existing MPS to unaddressed mail and door drops, and that
this should be publicised to consumers.

But Payne thinks MPS brings its own problems. "More people are opting
out of direct mail altogether. Every category is denied access; it is
then hard for companies to permission them back in," he says.

Payne says that by moving voluntarily towards permissioning data now,
the industry is "less likely to be tarred with the junk brush" and will
suffer less Draconian future legislation. "The industry could shoot
itself in the foot by not being seen to be progressive," he says.

With the threat of legislation, the two bodies are keen to forge
stronger links; the IPA is to consult members on reapplying for
corporate membership of the DMA.

However, it could be argued that as clients move more towards digital
solutions - which are largely "opt-in" by European Union directive -
questions of relevance, targeting and wastage will fade. Arnold says:
"Carpet bombing is not relevant. Clients are becoming more focused on
talking to the right people and, as ability to target data increases,
the problem will go away. Technology will resolve the worries that
people have. In five years' time, wastage isn't something people will be
talking about."

"Consumers tend to separate direct mail into two camps: the stuff they
are interested in is welcomed; the rest is seen as 'junk'. The
differences between the two, from the industry's perspective, are
targeting and relevance. The problem with 'opting in', for both
consumers and the industry, is that any good DM is lost with the
bad.

"To fight this, the industry must continue to invest in sharper, cleaner
data and more accurate targeting.

"If it can create more rewarding work, end the blanket mailings so
beloved of certain financial institutions, ask customers what they
actually want to receive, and support initiatives such as the Mail
Preference Service, then 'opting out', rather than 'opting in', would be
better for all concerned."

DMA - James Kelly, managing director, Direct Marketing Association

"The DMA champions marketers' commercial freedoms, within the bounds of
existing consumer protection mechanisms. We support the consumer's right
to say 'No', and have set in place the mechanisms to facilitate
that.

"The 'opt-out' basis for the DM industry has been a hard-fought freedom,
which enables client companies to get their proposition to new
customers.

"DMA members are responsible practitioners, who treat their consumers
with respect. In the absence of evidence that consumers' privacy is
being abused, it is naive to suggest that the industry should
voluntarily sacrifice the market opportunities afforded by 'opt-out'.
Those organisations who suggest otherwise are not serving their members'
best interests; they are even damaging their members' clients'
businesses."

IPA - David Payne, consultant head of direct marketing, IPA

"Direct mail is the odd man out in today's direct-response media.
E-mail, web and mobile marketers committed themselves to permission or
'opt-in' from the outset under the European Union Directive. As a
result, these media have worked harder to engage and involve consumers
to a point where people are happy to give their permission for further
communication. Cold mailings are considered junk - and have been the
subject of critical television programmes - and yet the UK direct
marketing industry has refused to accept or address its unpopularity and
intrusiveness, seemingly waiting until the EU forces an 'opt-in'
requirement on it.

"The IPA believes that DM mail should follow new media's lead by asking
consumers for their permission to be marketed to, if it wishes to engage
them, rather than annoy them."

MARKETER - Ian Armstrong, customer communications manager, Honda

"Clearly, direct mail should be 'opt-in'. If I send you something that
you didn't ask for, are not interested in and don't want, it's hardly
going to create a positive impact.

"If you subscribe to the view which is 'opt-out', it blanks everyone,
you are not able to solicit particular views from particular
individuals.

"Brands are all about trust. We don't want to send messages to people
who haven't subscribed because there is no long-term trust or loyal
relationship.

"'Opt-in' may give us fewer numbers, but we end up with people who
actively want to know about our brand and our company philosophy. With
more numbers comes more wastage."